Dick Costolo Admits There Is A Huge Hole In Twitter's Business

Perhaps in an effort to be more "mainstream," Twitter might be looking at implementing a "whisper mode," which would allow more than one friend to talk in private, CEO Dick Costolo says.

The move is an admission — writ large in Twitter's earnings call last night — that there is a huge hole in Twitter's business: Messaging.

Twitter was late to the messaging game even though it had a built-in audience that loves messages. Even now, Twitter's direct message function is primitive. It doesn't allow links, or group messages, and it's complicated to describe how exactly you turn it on so that anyone can message you.

Now the biggest messaging platforms — WhatsApp and Messenger — are in Facebook's hands. Viber was acquired by Rakuten in February. And Snapchat doesn't want to be acquired.

What remains are the niche, geographic messaging services like Kik and Line that may either be too small to help Twitter catch up or too big for Twitter to afford. The feeling is that Twitter should have paid attention to messaging about two years ago.

In an interview today with Bloomberg, Costolo described how the company might move more seamlessly between public and private conversations:

There are frequently public conversations that you would like to grab hold of and take into 'whisper mode' with a friend and say, 'Hey, this thing has happened. Look what these people are talking about. What do you think about this?' with a friend or more than one friend. So being able to move fluidly between that public conversation and the private conversation is something we'll make simpler.

Twitter currently allows you to send a direct message to one person at a time. But Costolo indicated that he envisions the "whisper mode" to allow more than one person into the conversation. A group-messaging mode has long been absent from the platform.

This isn't the first time that Twitter has indicated that it's trying new things with private conversations.

In October 2013 it began giving users the option to allow receiving messages from anyone. Until then, direct messages could only be sent to people who follow each other.

In December 2013, it updated its apps to allow people to send images in direct messages.

Last night on the earnings call, the issue of messaging — and Twitter's lack of presence in it — came up three times. After Anthony J. DiClemente of Nomura Securities asked about it, Costolo didn't respond. Then Jordan Monahan of Morgan Stanley asked about the same issue, and Costolo responded that he didn't think Twitter was affected by the same geographic niches that messaging appears to be locked into (i.e. WhatsApp is way more popular in Europe than the US). Finally, Costolo addressed the elephant in the room directly:

... there's a real opportunity for us when we think about our private messaging to strengthen the core of our Twitter product by making it easier for users to move more fluidly between the public conversation that happens everywhere on Twitter and the private conversation between you and a friend or you and a few friends. There are certainly places in the world where the private conversation is culturally looked upon as more valuable. And in those markets, we'll look to strengthen our core product by making it easier for those folks to move more fluidly between the public conversation and the private conversation within the product.

So there it is. Two years after messaging apps became hot, Twitter will move more deliberately into messaging.

To be fair to Costolo, it's a smart move. Twitter is for communicating with the public, not with close friends. And that audience — 255 monthly active users — will likely take to improved messaging on Twitter like ducks to water.

When it finally arrives.

Watch the entire Bloomberg interview with Costolo below:

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